Despite a recent holdup in the permit process, Oregon Clean Energy LLC. expects to break ground on its $800 million energy generation facility by late spring or early summer.
Oregon Mayor Mike Seferian and Administrator Mike Beazley recently met with Oregon Clean Energy officials to get an update on the project, which calls for the construction of a facility that will convert clean natural gas to electricity.
“They were supposed to break ground in April, but they were slowed down by the permit process,” said Seferian on Wednesday. “They needed a permit to put their power into the grid at the Bayshore power plant so they would be able to sell it, but it was held up a bit by First Energy,” said Seferian.
By last week, there were signs the project was again moving forward, he added.
“The permit should sail through, and things can take off now. The permit process should be streamlined, and we should see a formal groundbreaking ceremony shortly. We should know the status of when they expect to get the permit by the beginning of this week. It may now be more like June when we see the groundbreaking,” he said.
The facility, which will be built on a 30 acre parcel of land at 816 N. Lallendorf Road, located within an enterprise zone, will provide enough new electricity for 500,000 homes.
“In all likelihood, we’ll be working with them in the future to see if we can make them a municipal power company…and they can give us a better rate for the power,” said Seferian. “They could become the predominant power producer locally for the city and maybe the area. At the very least, they could bargain with some of our industrial users to supply them power directly without them having to go through the grid and paying transportation fees and maintenance agreements with First Energy. This could be real competition to First Energy.”
William Martin and Bill Siderewicz, managing partners of Oregon Clean Energy LLC, said last year they had been coming to Oregon for three years to discuss the project. Plans call for the plant to begin operations in 2017.
“Everything looks good for the project to continue,” said Seferian.
Company officials have been reviewing proposals from construction and engineering firms to build the project, and will likely make a selection this month, according to Beazley.
Oregon Clean Energy’s timeline has been on target since the company announced plans in September 2012 to construct the plant. The project has received enthusiastic support from the community.
Last year, council approved an enterprise zone agreement with company officials for a tax exemption of 100 percent for 15 years on the increase in assessed value of real and tangible property.
The Enterprise Zone Act allows communities to execute agreements for the purpose of establishing, expanding, renovating or occupying facilities and hiring new employees and/or preserving jobs within the zone in exchange for tax incentives.
The project is expected to create about 450 construction jobs over three years, and 26 new full-time, permanent jobs once the facility begins operations, with a total annual payroll of about $3.2 million.
The city approved an agreement with Clean Energy for the plant’s use of the raw water intake system that will generate about $1 million per year, which will help keep the water and sewer rates low.
The Oregon school board also approved a tax incentive donation agreement with Clean Energy, which will annually contribute funds to the district for 15 years. At the end of the agreement, the district will have received payments totaling $17.5 million.